Brent oil spot prices were rising on Tuesday’s market as analysts and investors became increasingly concerned about the situation in Syria, and the likelihood of military action from the U.S. government in the region. The rise comes after aggressive comments from the Obama administration about the situation in the Middle East.
A White House press conference on the conflict, which took place early this afternoon, set the tone for the government’s reaction to the crisis. White House press secretary Jay Carney said that the administration is not going to take military force off of the table, but President Obama had not yet made a decision.
The risk of military intervention in Syria saw investors shy away from stocks in today’s trading, while investors headed toward safer alternatives like gold, oil and U.S. Treasuries. Mr. Carney said that the fact that a chemical weapon attack had taken place was self evident, and a U.N. team tasked with proving that it had meant little to President Obama’s decision.
The turmoil caused by the indecision in today’s market might be cleared up tomorrow, but the resultant decision may not be what traders are looking for. Mr. Carney hinted that a decision on military force was imminent, and clearly stated that there would be a response to the use of chemical weapons.
This afternoon’s press conference will not, however, have much effect on the market’s perception of the crisis in Syria. The Obama administration will respond to the Syria crisis, but there has not been any public decision about whether the reaction involves military force.
Syria chemical attack
Syria’s government is charged with using chemical weapons on his own people. Mr. Carney struck a commanding tone on the administration’s stance on that charge. Syria’s Assad regime’s involvement in the attack is “clear and undeniable” according to Mr. Carney. There is, according to the administration, very little doubt that the Assad regime is responsible for the chemical attack.
Mr. Carney refused to speculate on what the White House would decide to do in Syria. Conflict in Syria is not a direct threat to oil supply, but the expansion of the conflict to neighboring countries could have a serious detrimental effect on that supply. Oil prices are likely to increase if the Obama administration decides to intervene in Syria.